Professional Documents
Culture Documents
Objectives:
What the company needs to do to accomplish its strategy measurable objectives.
Metrics:
Actionable and tangible measurements which support achieving objectives; this is
what makes it real.
Targets:
Performance level expectations set against the strategic plan. For each metric, set
a goal or plan so progress against the objective can be evaluated. Components of a
Scorecard To achieve our strategy, how should we appear to our customers?
Advantages of the new performance scorecard -Focus on relationship banking.
-Service was generally face to face or remotely depending on the wishes of the
customers.
-Critical for measuring long term strategies of the firm -Focus on branch service
as well as other services like 24 hours phone banking and ATM services.
-Customer survey was conducted only among 25 customers. This may lead to biased
results.
-A proper time lag was not given for the implementation of the new system.
-An exceptionally good performance in one area (e.g. audit) was not enough to
satisfy a marginally bad performance. Disadvantages of the new performance
scorecard -James McGaran was the manager of the most important LA branch.
-Been in the banking industry since 1977. With Citi since 1985.
PEOPLE AND STANDARDS: Focused on the efforts of the manager to develop and
communicate with peers/ employees.
Rating Scale: �Par�, �Below Par� and �Above Par�
Finally, a global rating and overall rating for the manager was awarded. -Customer
satisfaction and control goals common across all branches.
Financial Measures:
-Financial Performance 20% above par
-Highest Revenue among all branches
-Greatest margin contribution , 48% growth
-Rated exceptional by Lisa
Strategy Implementation:
-Household acquisition increased by 21%
-Balances grew in all segments
-Above par rated by Lisa in three quarters Financial District Branch Performance
Customer Satisfaction:
-Performance was below target for all the 4 Quarters
-Overall score was 66/80 which was just at par
Control Measures:
-Operating and Fraud losses of $137 thousand
-Some were from previous years and others out of branch control
-Rated above par
-Financial performance was the best as per industry standards and in comparison to
other branches
-Does not meet the overall minimum requirements to be rated above par
-If James given above par rating other managers will also demand the same
relaxation and they may not take new performance scorecard seriously What goes
against James? -Customer satisfaction measures included the services for which
branch was not responsible
-The customer base was too large, so customization of services as per requirement
of customer was difficult
-Overall customer satisfaction was also hit due to absence of a teller in the third
quarter Problems faced by James THANK YOU! -Award above par ratings
-Override the system and provide James
with a bonus of 30%
Consequences:
-Resentment among other Branch Managers
-Undue favor or biased decision harming national image
-Act as a precedent for deviating from defined standards
-Customer objective of the Bank would be defeated Alternatives-
1. Implement Lisa�s decision -Discuss the performance criteria with James
-Balance the over achievement in other scales with other areas 2.Follow set
standards